Budget Message 2018-2019 5-Year Capital Improvement Plan...

Budget Message 2018-2019 &

5-Year Capital Improvement Plan 2019-2023

Positioned to Keep Mebane Positively Charming

David S. Cheek, City Manager

CONTENTS

Budget Message ................................................................................................................................ 1

All Budgeted Funds for FY 2019 ........................................................................................................ 2

Economic Outlook ............................................................................................................................. 3

The General Fund .............................................................................................................................. 4

General Fund Revenues ................................................................................................................. 4

Property Taxes .......................................................................................................................... 5

Sales Tax ................................................................................................................................... 5

Intergovernmental Revenue ...................................................................................................... 6

Permits and Fees ....................................................................................................................... 6

Other Financing Sources ........................................................................................................... 6

Proposed Fee Changes .............................................................................................................. 6

General Fund Spending ................................................................................................................. 6

General Fund Budget Requests ................................................................................................. 6

General Fund Budget Overview ................................................................................................. 7

General Fund Department Budgets ........................................................................................... 8

The Utility Fund ............................................................................................................................... 11

Utility Fund Revenues .................................................................................................................. 11

Customer Fees ......................................................................................................................... 11

Proposed New Rates ............................................................................................................... 12

Other Financing Sources ......................................................................................................... 12

Utility Fund Spending .................................................................................................................. 13

Administration......................................................................................................................... 13

Operations ............................................................................................................................... 13

Water Resource Recovery ........................................................................................................ 13

Non-Departmental .................................................................................................................. 14

Budget Message Conclusion ........................................................................................................... 14

5-Year Capital Improvement Plan 2019-2023 .................................................................................. 14

Overview ..................................................................................................................................... 15

General Fund ............................................................................................................................... 15

Utility Fund .................................................................................................................................. 16

5-Year CIP Conclusion ..................................................................................................................17

Appendix 1: Budget Message Line Item Budget .............................................................................. 18

City Council ................................................................................................................................. 18

Administration ............................................................................................................................ 19

Finance ........................................................................................................................................ 20

Information Technology .............................................................................................................. 21

Economic Development .............................................................................................................. 22

Public Facilities ............................................................................................................................ 23

Police ........................................................................................................................................... 24

Fire .............................................................................................................................................. 25

Planning ...................................................................................................................................... 26

Inspections .................................................................................................................................. 27

Public Works ................................................................................................................................ 28

Sanitation .................................................................................................................................... 29

Recreation & Parks ...................................................................................................................... 30

Non-Departmental ...................................................................................................................... 31

Billing & Metering (Administration) ............................................................................................. 32

Utility Operations ........................................................................................................................ 33

Water Resource Recovery (WWTP) ............................................................................................. 34

Non-Departmental ...................................................................................................................... 35

Appendix 2: Budget Message Fee Schedule Changes ...................................................................... 36

General Fund Fee Changes .......................................................................................................... 36

Utility Fund Fee Changes ............................................................................................................. 41

Appendix 3: 5-Year CIP General Fund Requests by Department ...................................................... 44

Appendix 4: 5-Year CIP Utility Fund Requests by Department ........................................................ 45

1

B U D G E T M E S S A G E

May 7, 2018

Mayor and City Council

City of Mebane, North Carolina

Dear Mayor and Council,

It is a great time to be in Mebane! New jobs, both in and around Mebane, are drawing new

residents to our community in growing numbers just as our demographic forecasts have

projected. The inventory of new homes and apartments, along with continuing industrial

inquiries, points to a continuing and increasing growth outlook for the next several years.

These factors, combined with Mebane’s small town charm, prime location near the Triangle,

and quality City amenities, will continue to draw new people. Thanks partly to this growth,

the City continues to enjoy strong investment levels that enable high quality municipal

services at a sustained low tax rate. Mebane was the only city in the area to cut its tax rate

last year. This year, I am not proposing a tax increase; however, utility rates are

recommended to increase by 5%. This will continue Mebane’s tradition of low taxes and

utility rates. The balancing act for the coming year and years to come is to continue providing

quality services and infrastructure, maintain our small-town atmosphere, and embrace the

new people moving into the City.

The City Council has positioned our City to keep it Positively Charming. The City has spent

the last several years operating in the midst of progressive growth, while diligently planning

for growth to come. With extensive citizen input, the City Council has initiated plans for

recreation and parks; bike, pedestrian and vehicular transportation; utilities and land use.

Mebane by Design, the City’s Comprehensive Land Development Plan, was approved in

2017, and we are currently in the process of updating our Unified Development Ordinance to

dovetail with this plan. Within the next six months, plans for a safer railroad corridor and a

downtown vision will be finalized. The purpose of all this planning is (1) to clarify the City

Council’s vision of what Mebane will look like in the future; (2) to direct the agenda for

making smart, strategic operational and infrastructure decisions; and (3) to ensure that we

stay true to the values that the City holds dear.

Significant strides have been made to implement the 2014 Recreation and Parks Master Plan

with grand opening of the new $9 million Community Park slated for this summer. The only

significant projects remaining include a community swimming pool and fitness center, Lake

2

Michael trails, and greenway development, the latter being one of the top priorities in the

plan.

The Bike & Pedestrian Transportation Plan (BPTP) was approved in 2015, and several sidewalk

and crosswalk projects have been completed since then. This year, the City Council took

another major step of the BPTP by appointing the Bike and Pedestrian Advisory Committee.

The committee is charged with advising the Council on prioritization of projects, advocacy

for the plan, and seeking opportunities for funding and partnership. The BPTP is an

expansive, but expensive plan with hundreds of potential projects. The expense is evident as

the preliminary design for our first 1.5-mile greenway is projecting a $2.4 million price tag.

The Council is carefully grappling with how to fund a comprehensive greenway plan with this

1.5 miles as the first step. As a brand new service and amenity, greenway trails in Mebane

will require a consistent and significant funding source over the next few years. The BPTP is

a long-term infrastructure plan and will require a long-term funding source.

With this in mind, and with an eye toward the future, I am pleased to provide the

Recommended Budget for the fiscal year ended June 30, 2019 (FY 2019) and 5-Year Capital

Improvement Plan for 2019-2023 (5-Year CIP). I believe this spending plan is focused on the

City Council’s vision for the future, developed within the framework of the City’s planning

processes, and will accomplish the City Council’s goals for this year and for years to come.

A L L B U D G E T E D F U N D S F O R F Y 2 0 1 9

The annual budget now includes five funds: two General and Utility operating funds, two

respective capital funds and a Utility Capital Reserve Fund, as shown below. The capital

funds allow the City to remove larger capital outlays from operations for more consistent

reporting and evaluation of operating trends. The capital funds also allow the City to

accumulate reserves for future capital outlays. The Utility Capital Reserve Fund is the direct

result of implementing the General Assembly’s House Bill 436 and adopting System

Development Fees. These fees will replace the current water and sewer connection fees and

as required by the statute, these fees must be deposited into a capital reserve fund. Taken

as a whole, for comparison’s sake, the General Fund is increasing by 5.3% over last year,

while the Utility Fund is 7.7% more than the FY 2018 budget.

3

E C O N O M I C O U T L O O K

According to the N.C. League of Municipalities, the national economic outlook appears high

for the next year. In the Duke University-CFO Global Business Outlook Index, the Optimism

Index is at an all-time high. Forty percent of companies plan to increase wages, and 38

percent plan to increase hiring, in part as a result of federal corporate tax reform. Similarly,

the American Institute of CPAs’ Outlook Index is at its all-time high, with optimism reflected

in employment and capital spending plans. The Consumer Confidence Index is near its

highest level since 2000, and the Dow Jones index peaked in January with a correction

through April but remains 18% up from a year ago.

Similar to the national economy, North Carolina’s economic outlook is strong. According to

Dr. Michael Walden of N.C. State, the State’s aggregate growth rate in real GDP surpassed

national growth for the third straight year in 2017. Walden’s index of economic indicators is

up by 2.9 percent from last year. Walden projects that economic growth in 2018 will expand

real GDP by 2.8 percent, reduce the jobless rate to 3.6 percent, and add 70,000 jobs. He does,

however, cite inflation, higher interest rates, and a possible trade war as factors to watch in

2018.

Unemployment continues to improve in the City. The Alamance County unemployment rate

has improved to 4.3% compared to 4.6% the previous year. The Orange County rate has also

improved from 3.7% last year to 3.1% this year. The improved unemployment numbers

reflect state and national rates, but are also a sign of the many new jobs recruited to Mebane.

New single-family home construction is on the upsurge as the first phases of The Meadows

(369 lots) and Woodlawn Estates (26 lots) are appearing. Building permits for this year are

expected to approach 300, almost double the 5-year annual average of 150. With the rate of

new home construction steadily growing, demand for housing has prices on the rise. Several

other housing developments are in various stages of construction including Magnolia Glen

All Budgeted Funds

FY 2018

Original

FY 2019

Recommended

% Change

from FY

2018

General Fund

Operating............................................. 18,551,000$ 17,967,470$ (3.1%)

Capital.................................................. - 1,561,530 N/A

Total........................................................ 18,551,000$ 19,529,000$ 5.3%

Utility Fund

Operating............................................. 6,838,741$ 7,673,390$ 12.2%

Capital.................................................. 1,166,294 550,000 (52.8%)

Capital Reserve..................................... - 400,000 N/A

Total........................................................ 8,005,035$ 8,623,390$ 7.7%

4

(244 lots), Villas on Fifth (110 lots), Northeast Village (99 lots), Phase III of the Villages at

Copperstone (50 lots), the Villages at Lake Michael (68 lots), and Cambridge Park (731 lots).

All in all, approved single-family projects total 1,698 units. Of these, roughly 492 have been

permitted for construction with 1,206 dwelling units remaining to be permitted. Of the six

apartment complexes (1,055 units) approved in recent years, five are complete or under

construction. These numbers do not include older approved developments that have not

been fully developed, such as Mill Creek.

The recently approved multifamily projects total 1,055 units, of which 463 have been

permitted for construction. All except Arrowhead North (162 units) will likely be constructed

and occupied by the end of the summer. The City’s apartment inventory has now risen to

2,651 units that are 95% occupied.

During this past year, Airgas USA announced that the City was its choice to locate a $47

million facility with 35 new jobs paying an average wage of $79,286. Lotus Bakeries broke

ground recently on its $55 million manufacturing plant which will make Biscoff cookies. The

company will hire 60 employees at an average salary of $35,931. Prescient, located in the

N.C. Commerce Park, has begun operations as well, promising to employ 205 people at an

average wage of $46,322. These projects add to Mebane’s economic development successes

during this decade, with almost $500 million in new taxable investment and over 1,800 new

jobs.

T H E G E N E R A L F U N D

As stated previously, the 2019 budget includes the General Fund and its Capital Fund. Since

FY 2019 is our first year with both funds, for purposes of this budget message, these two

funds are combined for easier comparison to the FY 2018 budget and the FY 2017 actual

expenditures. Therefore, when the spending plan is discussed, all capital items have been

included in the department for which the items will be purchased. As mentioned earlier, the

General Fund budget for FY 2019 amounts to $19,529,000, an increase of 5.3% over the FY

2018 budget. The balanced budget formula required by State statute requires that estimated

revenues plus other financing sources, including appropriated fund balance, equal the total

budget appropriation.

G E N E R A L F U N D R E V E N U E S

The General Fund’s primary sources of revenue include property taxes, sales taxes,

intergovernmental revenues, and permits and fees. Property and sales taxes, make up just

over 80% of all General Fund revenues. Over the past decade, the City’s revenue sources

have become much less diversified due to the repeal of taxes at the state level, resulting in

an increased dependence on the property tax. This year the City expects solid revenue

growth due to a strengthening housing market, an expanding tax base and continued growth

in retail sales. Total revenues are estimated to grow 5.3% over this year, and total

$17,101,923. Other financing sources total $2,427,077, and balance the budget at

5

$19,529,000. Included in other financing sources are debt financing of $677,077 and

appropriated fund balance of $1,750,000.

PROPERTY TAXES

Property taxes comprise 62% of revenues. The budget does not propose a property tax

increase, and is balanced with a property tax rate of $0.47 which means that for every

$100,000 in value of property, $470 is levied in property tax. At this tax rate, along with a

98.5% collection rate, property tax revenues will total $10,633,448, a 6.2% increase over this

year. The additional property tax revenue is due to growth in the City’s tax base and in motor

vehicle taxes. The total tax base for FY 2019 is projected to be $2,174,684,816, a 6.5%

increase over last year. One cent on the tax rate produces $200,426.

SALES TAX

Sales tax makes up 19% of the City’s total revenues. Two cents of the combined state and

local sales tax rate of 6.75% is distributed to local governmental jurisdictions. These local

option sales tax revenues are distributed on a proportional population basis to municipalities

within Alamance County. Mebane’s share of sales tax revenues is projected to be $3,317,200,

a modest 3.7% increase over FY 2018. While this continues a positive trend, the growth rate

is down from the double-digit growth of recent years, due in part to a change in the way the

State distributes statewide sales taxes.

General Fund

FY 2018

Original

FY 2019

Projected

%

Change

from FY

2018

Revenues

Property taxes.......................................... 10,013,053$ 10,633,448$ 6.2%

Sales taxes................................................ 3,200,000 3,317,200 3.7%

Privilege licenses...................................... 500 900 80.0%

Unrestricted intergovernmental.............. 1,758,943 1,677,700 (4.6%)

Restricted intergovernmental................. 365,650 419,650 14.8%

Permits & fees.......................................... 739,000 819,000 10.8%

Sales & services........................................ 100,000 105,000 5.0%

Investment earnings................................. 12,000 12,000 0.0%

Miscellaneous........................................... 122,000 117,025 (4.1%)

Total revenues............................................. 16,311,146 17,101,923 4.8%

Other financing sources

Transfers in............................................... - - N/A

Debt proceeds.......................................... 436,000 677,077 55.3%

Appropriated fund balance..................... 1,803,854 1,750,000 (3.0%)

Total other financing sources..................... 2,239,854 2,427,077 8.4%

Total revenues & other financing sources.. 18,551,000$ 19,529,000$ 5.3%

6

INTERGOVERNMENTAL REVENUE

Intergovernmental revenues consist primarily of the Electricity Sales Tax and the Powell Bill

Allocation, and comprise approximately 12% of revenues. The Electricity Sales Tax is

collected by the State and is distributed to the City based on the actual receipts from the

providers of electricity within the City’s limits. The Powell Bill Allocation from the State is

restricted to maintaining, repairing, or constructing City owned streets and rights -of-way.

Other state-shared revenues include sales taxes on telecommunications, video

programming and natural gas. Restricted intergovernmental revenue is estimated to be

$419,650, a 14.8% increase over this year. Unrestricted intergovernmental revenue is

decreasing to $1,677,700 compared to this year’s budget. This 4.6% decline is primarily the

result of a drop in utility franchise and telecommunications taxes, and a better estimate in

shared tax revenues from the NCCP interlocal agreement.

PERMITS AND FEES

Permits and Fees consist primarily of planning and inspection fees associated with

residential and non-residential development within the City and its extraterritorial

jurisdiction (ETJ). Total permits and fees are expected to be $819,000, making up about 5%

of total revenues. The residential sector is continuing its strong pace of growth accounting

for much of the 10.8% rise in permits and fees. Also, contributing to this increase are

proposed fee increases to bring the City’s fee schedule more in line with the surrounding

market.

OTHER FINANCING SOURCES

In order to balance the budget, appropriated fund balance of $1,750,000 is required in

addition to a $677,077 bank loan to purchase police cars and radios. The amount of fund

balance that is appropriated is a financially prudent goal that allows the flexibility to adjust

for unexpected opportunities or challenges during the year without requiring amendments

to the budget.

PROPOSED FEE CHANGES

The only fee changes proposed in the General Fund budget are changes to certain inspection

fees. The proposed changes are in keeping with fees charged by neighboring jurisdictions.

Appendix 2 provides a redlined fee schedule that is proposed for FY 2019.

G E N E R A L F U N D S P E N D I N G

GENERAL FUND BUDGET REQUESTS

The General Fund includes all the basic governmental functions for operating the City.

Requests from departments totaled $22,419,156, so to maintain the current $0.47 tax rate, I

am recommending reductions in the department requests totaling $2,890,156. These

reductions are not made lightly. I work with the department heads in making these changes

7

which, for example, might involve decisions like repairing old trucks and equipment for

another year instead of replacing them or doing without a new position for one more year.

The following “snapshot” list provides some of the significant requested items included in

the budget, as well as some not included in the budget.

GENERAL FUND BUDGET OVERVIEW

The proposed spending plan for the General Fund amounts to $19,529,000, a 5.3% increase

over last year’s adopted budget of $978,000. New items significantly increasing this budget

include the purchase of police radios and four new police vehicles; a full year of personnel

and operational costs at the new community park; the design of the MACC-Holt Street Park

Greenway; the addition of three firefighters; new sidewalks on West Center, West Clay,

North Second and West Jackson Streets; and increased funding for street resurfacing.

Offsetting some of these items is a reduction in expected economic incentive payments and

the capital outlay reduction in Fire due to the purchase of radios in FY 2018.

Salaries & Benefits The budget provides for a 2% COLA and merit raises, along with an allowance for a State-

required increase in the retirement rate. Health claims were much lower this year and our

Requests Included in the Budget Requests Not Included in the Budget

Street repaving.................................... 550,000$ Sidewalks - US70 & 9th St............... 281,000$

Police replacement radios................... 469,430 Sanitation truck............................... 280,000

2% COLA and merit increases............. 274,025 Leaf truck replacement................... 200,000

MACC-Holt Street greenway design .. 219,700 Traffic Officer.................................. 142,457

Four replacement police vehicles....... 207,648 Sidewalk connectors....................... 102,674

BPTP - Sidewalk Projects.................... 202,400 Dump truck...................................... 100,000

Three Firefighters - Half Year.............. 131,557 Deputy Chief Position..................... 98,236

New Park operating & equipment...... 105,900 Communications Manager (PIO).... 92,290

New Park personnel & benefits........... 94,246 IT Specialist..................................... 81,053

Fire replacement brush truck.............. 90,000 HR Specialist................................... 68,399

Fire preemption System...................... 72,000 Cemetery entrance walls................. 60,000

Handicap ramps & crosswalks............. 40,000 Police motorcycles.......................... 54,000

MACC gutter replacement.................. 37,500 Fire training pickup......................... 41,500

Contract for PIO................................... 30,000 Sanitation pickup............................ 26,000

Police space needs study..................... 30,000 Fire HVAC........................................ 24,000

Christmas decorations......................... 30,000 IT replacement servers.................... 15,000

FY 2018

Original

Budget

FY 2019

Recommended

%

Change

Salaries & Benefits 9,482,713$ 9,841,133$ 3.8%

Operations 7,770,318 8,057,412 3.7%

Capital Outlay 1,297,969 1,630,455 25.6%

Total $ 18,551,000 $ 19,529,000 5.3%

8

renewal quote for employee health benefits came in with only a slight increase in some rates,

while maintaining the existing coverage levels. The City currently has 135 employees and

departments requested eight (8) new positions. The Police Department requested a traffic

officer; the Fire Department requested a Deputy Chief and three Firefighters; Administration

requested a Communication Manager (PIO) position and a Human Resource Specialist ; and

Information Technology (IT) requested an IT Specialist. I am recommending we fund three

firefighters for one-half the year, but not the other requested positions. One Public Works

position has been moved to the Utility Fund as discussed later, and the budget includes

funding to contract for the public information service improvements. The FY 2019 budget

includes the continuation of the allocation of administrative costs to the Utility Fund,

totaling $577,901.

Operations Operating costs for the coming year are increasing by 3.7%. Operating costs for the new

park, first year of debt service on the new park, and an increase in street repaving account

for the majority of the costs, which are somewhat offset in the past by a reduction in

expected economic incentive payments expected to be due.

Capital Outlay The budget includes $1,630,455 in capital purchases including police cars and radios, new

sidewalks, several lawn mowers for Public Works and Recreation, a brush truck and

preemption system for Fire, the Joe Thompson legacy sculpture, and design of the new

greenway.

GENERAL FUND DEPARTMENT BUDGETS

The budget following table contains the recommended budget for each department in the

City. This is followed by an executive summary of the significant items for each departmental

budget. The line-item budget is included in Appendix 1.

9

Administration This budget is increasing by 2.8%, and includes $30,000 to contract for communications

services to start an “Official City of Mebane” social media page to improve communications

to and from the public, as well as improving content and current information on the City

website. The other new item in this budget is the addition of security improvements at the

front desk in City Hall.

Finance The Finance Department budget’s decrease from the prior year is largely due to the removal

of one-time costs for the financial system conversion expected to be completed in FY 2019.

Information Technology The Information Technology budget reflects a reduction for capital items completed in the

prior year, with a focus on implementation of new technology in FY 2019.

Economic & Physical Development Based on construction schedules and milestones for various agreements, economic

incentives expected to be due in FY 2019 reflect a reduction from the prior year.

Public Facilities The Public Facilities budget includes funding for the Thompson Legacy Sculpture and

foundation repairs to the library. These new costs are offset by reduced spending compared

to FY 2018 for the Council chambers technology improvements.

Police The Police budget includes full-year funding for positions newly hired in FY18, replacement

General Fund

FY 2018

Original

FY 2019

Recommended

% Change

from FY

2018

Council.................................................. 86,022$ 86,160$ 0.2%

Administration..................................... 1,005,906 1,033,978 2.8%

Finance.................................................. 740,292 583,176 (21.2%)

Information Technology...................... 243,431 240,889 (1.0%)

Economic Development...................... 1,105,850 685,850 (38.0%)

Public Facilities..................................... 752,483 754,477 0.3%

Police.................................................... 3,813,906 4,397,574 15.3%

Fire........................................................ 3,225,525 2,869,249 (11.0%)

Planning................................................ 374,254 808,588 116.1%

Inspections............................................ 506,512 518,476 2.4%

Public Works......................................... 2,151,996 2,348,712 9.1%

Sanitation............................................. 988,415 1,127,918 14.1%

Recreation & Parks............................... 1,373,484 1,629,325 18.6%

Non-Departmental............................... 2,182,924 2,444,629 12.0%

Total........................................................ 18,551,000$ 19,529,000$ 5.3%

10

radios and four replacement vehicles. The continued funding of in-car cameras nets with a

reduction for one-time critical incident preparedness kits for minimal operating impact.

Fire The Fire Department budget includes the addition of three new firefighters for half the year

netted against a reduction in part-time salaries. The reduction in capital is the result of the

one-time purchase of replacement radios last year netted with the addition of a replacement

brush truck.

Planning The 2019 budget separates Planning and Inspections into separate departments, with

Planning retaining the majority of the shared office expenses. The Planning budget includes

the full year costs of the Development Director position hired in FY18, one-time funding for

grants and additional professional services to aid in plan review, GIS updates and the like.

Inspections The Inspections Department, separated from Planning in FY 2019, includes the addition of

funding for the purchase of planning and permit software to integrate with the new

accounting system to provide better customer service and online capabilities which should

result in greater efficiency for the Department.

Public Works Personnel costs in the Public Works budget reflect the transfer of a position to the Utility

Fund. Operations reflect an increase in funding for street repaving. The increase in capital is

for sidewalks recommended by the Bike & Pedestrian Plan.

Sanitation Fully staffed in FY 2019, the Sanitation budget includes an increase in vehicle maintenance

for major repairs in order to delay purchase of replacement garbage trucks.

Recreation & Parks The new City Park includes full year funding for two positions hired for only three months in

FY18, along with first year estimates of operating costs. Capital includes funding for the new

park’s amphitheater and miscellaneous equipment, replacement mowers, and replacement

gutters and automatic door closers for the Mebane Arts & Community Center.

Non-Departmental Included in this department, the city funds several outside agencies that provide services for

the citizens of Mebane. I am proposing to assist the United Way with the funding of their 211

services provided to our citizens. Mebane citizens who have emergency needs for housing,

food, utilities, mental health issues, and other household needs are connected to

appropriate agencies for assistance. In the last year, the agency took 199 calls for service.

Burlington and the County also support this service. The following table includes the

11

proposed funding for all outside agencies for FY 2019.

Agency Amount

Mebane Historical Museum Subsidy $ 37,600

Alamance County Arts Council 10,000

Train Collection Expenses 5,900

ACTA Subsidy 5,252

United Way 211 1,000

Other non-departmental expenses include retiree health care and property and liability

insurance, with an increase in FY 2019 for the new park and for cyber insurance. Debt service

costs also include the first full year payment on the new park.

T H E U T I L I T Y F U N D

The Utility Fund is an enterprise fund designed to account for all revenues and costs

associated with the City’s water and sewer system. Utility operations are budgeted across

three funds in FY 2019: the annual enterprise fund, capital fund and capital reserve fund. The

recommended budget (net of internal transfers) for FY 2019 is $8,623,390, a 7.7% increase

over the FY 2018 budget.

U T I L I T Y F U N D R E V E N U E S

CUSTOMER FEES

The adoption of HB436 required a study of the system’s revenues and expenditures related

to growth of the system. At the same time, the requirement to budget system development

fees in a separate capital reserve fund presented the necessity to review fees for general

operations of the utility fund as well. The City engaged a consultant to perform a rate study

to include proposed water and sewer rates. The City last completed a comprehensive study

of its rate structure in 2008, and Council elected to shift from a system-wide decreasing block

rate to a uniform rate for all in-city and out-of-city customer classes. It has been six years

since the City last revised the uniform rate structure in 2012. The minimum bill for all

customers is based on a usage of 2,000 gallons since 2008. The table below, taken from the

study, shows the City’s recent uniform rate tiers.

Use

2008 2012 – Present

0-2,000

gallons

Each

Additional

1,000 gallons

0-2,000

gallons

Each

Additional

1,000 gallons

In-City Water $9.50 $4.75 $11.64 $5.82

In-City Sewer $10.20 $5.10 $12.50 $6.25

Out of City Water $19.00 $9.50 $12.80 $12.80

Out of City Sewer $20.40 $10.50 $12.50 $12.50

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PROPOSED NEW RATES

According to the rate study, the average in-city residential account fails to yield adequate

revenue to build operating reserves and the enterprise fund as a whole exhibits a significant

imbalance in water and sewer profitability. After reviewing the study, staff recommends a

5% increase for in-city water rates to $6.11 per 1,000 gallons. This results in a monthly

water billing increase of $1.04 for the average in-city residential customer and results in a

minimal operating profit for the water system. Staff recommends a 5% increase for in-city

sewer rates to $6.56 per 1,000 gallons. This results in a monthly sewer billing increase of

$1.11 for the average in-city residential customer and still results in an operating loss for the

sewer system. Sewer rates will require a multi-year phased increase in rates in order to

overcome operating deficits. With the rate increases, we are proposing to lower the

minimum monthly water and sewer charge. Currently the City relies on a minimum monthly

charge equivalent to 2,000 gallons of billed consumption. Any rate increases may potentially

be viewed as disproportionately affecting the lowest tier consumers who routinely consume

less than the 2,000-gallon threshold. With this in mind, we propose a reduction in the

minimum tier to 1,000 gallons. The red-lined City fee schedule is included in Appendix 2

showing these proposed changes in utility rates.

About 90% of the revenues generated in the Utility Fund are comprised of the water and

sewer fees charged to customers for service, and our customer base has been growing 5% to

6% each year. The proposed budget includes an increase in sales of around 11.7% to inc lude

a combination of new customers and the proposed rate increase.

OTHER FINANCING SOURCES

In order to balance the budget this year, I am recommending that the City Council

appropriate fund balance of $1,800,000. With the proposed FY 2019 spending plan of

All Utility Funds

FY 2018

Original

FY 2019

Projected

%

Change

from FY

2018

Revenues

Sales and Services.................................... 5,416,390$ 6,052,340$ 11.7%

Connection Fees....................................... 450,000 - (100.0%)

Intergovernmental................................... 61,300 87,000 41.9%

Permits and Fees...................................... 88,050 139,050 57.9%

Investment Earnings................................. 1,000 5,000 400.0%

Miscellaneous........................................... 90,000 90,000 0.0%

Total revenues............................................. 6,106,740 6,373,390 4.4%

Other financing sources

Appropriated fund balance..................... 1,898,295 1,800,000 (5.2%)

Total revenues & other financing sources.. 8,005,035$ 8,173,390$ 2.1%

13

$8,623,390 and estimated revenues of $6,823,390, the budgetary use of fund balance will be

required to fill the gap. As with the General Fund, the City has traditionally budgeted fund

balance with the understanding that conservative budget techniques typically do not result

in actually dipping into the City coffers.

U T I L I T Y F U N D S P E N D I N G

The total budget for the Utility Fund is proposed at $8,623,390, a 7.7% increase over the FY

2018 budget.

ADMINISTRATION

The administrative budget accounts for billing and metering, and includes continuation of

the meter replacement program begun in FY18. The meter replacement project adds

valuable service for water customers that (1) allows them online access to their account and

daily usage of water and (2) notifies them via email or cell in real time of potential leaks. For

the City, the system allows all meters to be read through Verizon’s cellular data network,

eliminating the need for personnel to ride around manually reading meters. The City will also

have the same access to water usage data to assist customers with problems related to

billing and usage. Also displayed in Administration is the capital reserve required by adoption

of HB436 to account for system development fees.

OPERATIONS

Operations include the transfer and reclassification of a position from Public Works to

oversee maintenance and operations as the Utilities Director. In addition to the continuation

of the Inflow/Infiltration study, the budget includes annual allocations for mainte nance of

pumps and water and sewer lines. The capital budget includes funding for oversizing

Cambridge Hills and Northeast Village water lines, phase II of the NC119 relocation project

and the Hillsborough Road improvement project.

WATER RESOURCE RECOVERY

The Water Resource Recovery budget includes the addition of a plant mechanic position and

additional funding for dewatering. Planned capital projects for the GKN Reroute, WRRF

Upgrade and Floodwall construction will be debt-funded and therefore will be established in

Utility Fund

FY 2018

Original

FY 2019

Recommended

% Change

from FY

2018

Administration..................................... 1,549,909$ 2,049,556$ 32.2%

Operations............................................ 3,301,970 3,961,402 20.0%

Water Resource Recovery.................... 1,995,701 2,142,818 7.4%

Non-Departmental............................... 1,157,455 469,614 (59.4%)

Total........................................................ 8,005,035$ 8,623,390$ 7.7%

14

a capital project ordinance. Design and engineering are planned for FY 2019, with

construction to begin the following year.

NON-DEPARTMENTAL

The Non-Departmental budget includes a decline in debt service as we pay down debt, and

a reduced transfer to the Utility Capital Fund established in last year’s budget with the

establishment of the Reserve Fund to account for System Development Fees. The prior year

also included a one-time transfer for construction of water and sewer lines to the new park.

B U D G E T M E S S A G E C O N C L U S I O N

The City continues to provide efficient and effective government services for its citizens ,

while not increasing property taxes. The Utility Fund does require a modest 5% increase in

rates, but this is the first increase in six years. The City Council’s visionary plans to create a

safe, family-friendly community are making Mebane a prime location for people to make

their homes. The City is positioning itself well to meet the challenges of rapid growth, while

also planning for new amenities for its citizens.

5 - Y E A R C A P I T A L I M P R O V E M E N T P L A N 2 0 1 9 - 2 0 2 3

Looking to the future, Mebane is in a great position to embrace the coming growth. The City will

complete its $8.5 million community park at the west end of Clay Street this summer. The

completion of this park was the major project of the 2014 Recreation & Parks Master Plan

(RPMP). The only major ventures left in RPMP include a community pool, some more parks,

Lake Michael trails, and a fitness complex. On the heels of this, the City begins design of its

premier greenway trail from the Mebane Arts and Community Center to Holt Street Park. This

is the first big step of the 2016 Bicycle & Pedestrian Transportation Plan (BPTP). With the recent

appointment of the Bike & Pedestrian Advisory Committee (BPAC), the City is poised to tackle

the expansive goals of the BPTP. Other projects from the BPTP include several new sidewalk

additions, a pedestrian connector to one of the City’s outlying neighborhoods, and some bike

projects. These two plans are important planning tools for the City Council in their efforts to

carry out citizen-led initiatives. They are progressive and bring a new dimension of amenities to

an already walkable and active Mebane.

The next five years will be pivotal in carrying out the visionary plans of the City Council. The 5-

Year CIP is a planning tool designed to aid the City Council in building, acquiring and replacing

the City’s capital assets. The plan is updated annually to ensure that it is based on the most

accurate information available and is reflective of the current and projected economic

environment. Adoption of the 5-Year CIP by the City Council does not constitute a commitment

to fund a particular item, but rather signifies an intention to fund at he indicated amounts during

the ensuing years. As the City prepares for mounting growth, funding for the very ambitious

BPTP, as well as the RPMP, will need to be balanced with the ongoing infrastructure and capital

needs of City departments.

15

O V E R V I E W

The 5-Year CIP includes capital outlays in the General and Utility Funds totaling $30,915,451. For

FY2019, departmental capital outlays are included in the Manager’s Recommended Budget. Any

major projects expected to take more than a year to complete will require a capital project

ordinance to be approved by the Council during FY2019. The General Fund improvements are

estimated total $15,667,333 while the Utility Fund’s projected costs amount to $15,248,118.

These costs are divided into two major categories – Capital Projects and Annual Capital Outlay.

Capital Projects are those projects that require major capital expenditures and take more than

one year to complete. In contrast, Annual Capital Outlay requests are made by department

heads and include any capital items greater than $20,000 that will significantly impact their

specific budgets. The funding plan for the 5-Year CIP includes $13,084,397 in debt financings,

$17,393,554 in pay-as-go or cash, and $437,500 in grants.

G E N E R A L F U N D

In addition to General Fund annual projects, the primary capital need over the next five years is

implementation of the Bicycle & Pedestrian Transportation Plan. Specifically, the MACC to Holt

Street Park Greenway accounts for $2.4 million of the five year plan. Phase 2 of the new

community park will include completing the amphitheater in 2019 and the parking lots in later

years. Parking lots may be moved up as we evaluate the parking availability after the park opens

this summer. Other significant projects include the extension of Lake Michael trails and

improvements at Cates Farm Park. We are currently engaged with a consultant to determine

improvements for the Cates Farm Park, but a preliminary estimate includes $500,000 in the out

years of the 5-Year CIP. Departments also have ongoing capital outlay needs with Public Works

leading the way with $3.3 million in needs over the next five years. Police, fire and sanitation also

have significant needs in excess of $1 million.

Project Budget Total 2019 2020 2021 2022 2023

General Fund....................... 15,667,333$ 2,141,377$ 5,491,816$ 3,619,483$ 2,754,655$ 1,660,002$

Utility Fund......................... 15,248,118 2,544,922 9,558,196 1,010,000 1,035,000 1,100,000

Total................................ 30,915,451$ 4,686,299$ 15,050,012$ 4,629,483$ 3,789,655$ 2,760,002$

Funding Sources

Cash..................................... 17,393,554$ 3,821,722$ 4,392,692$ 3,399,483$ 3,019,655$ 2,760,002$

Grant Funding..................... 437,500 187,500 - - 250,000 -

Debt Financing.................... 13,084,397 677,077 10,657,320 1,230,000 520,000 -

Total................................ 30,915,451$ 4,686,299$ 15,050,012$ 4,629,483$ 3,789,655$ 2,760,002$

16

A detailed list of the departmental capital outlays in the General Fund is provided in

Appendix 3.

U T I L I T Y F U N D

The major project in the Utility Fund’s 5-Year CIP includes a $5.4 million upgrade to the water

resource recovery facility. This project, being undertaken in phases, is intended to meet the

standards set by the N.C. Environmental Management Commission for the Jordan Lake Rules

governing discharge in the lake’s drainage basin. In addition, the improvements will expand the

permitted capacity of the plant from 2.5 MGD to 2.99 MGD. While the upgrades to the plant

over the past few years are achieving desired results, a recent engineering study, along with the

Long Range Utility Plan (LRUP) set forth the next steps in this project. During FY 2019, the

floodwall will be designed along with the re-routing of the GKN pump station. Mebane

negotiated an agreement with Graham to give the City 750,000 gallons per day (.750 MGD) of

waste water capacity. As part of the agreement with Graham, Mebane needs to re-route the

GKN pump station force main to pump west to the NCCP gravity lines installed two years ago

that flow to Graham’s Cherry Lane pump station. This project is expected to cost $1.5 million

and will divert approximately 250 MGD from the Mebane WRRF. Design of this project will begin

in FY 2019.

Along with annual allocations for maintenance and repairs, other significant items in the Utility

Fund include an inflow and infiltration study that will find problem areas in our sewer collection

system increasing its efficiency and reducing treatment costs. An allocation of $200,000 each

year over the next five years will fund any repairs noted during the study and is included in Sewer

Mains. Included in Meters is the meter replacement program implemented in FY 2018. This is a

plan to replace all meters in the City with internet-connected customer accounts that improve


Recreation Master Plan

Community Park Phase 2.... 375,000$ 25,000$ -$ 75,000$ 275,000$ -$

Lake Michael Trails............. 250,000 - 25,000 225,000 - -

Cates Farm Park.................. 500,000 - - 50,000 450,000 -

Bike & Pedestrian Plan

Sidewalks............................ 1,168,000 202,400 491,700 194,900 158,350 120,650

Greenway Trails................... 2,653,001 219,700 2,184,320 236,981 12,000 -

Bicycle Improvements........ 75,355 14,700 13,405 38,000 4,500 4,750

Connectors.......................... 1,303,597 - 102,794 308,379 223,106 669,318

Annual Capital Outlay

Police................................... 1,378,320 707,077 155,737 163,523 171,699 180,284

Fire....................................... 1,772,500 198,000 304,500 750,000 520,000 -

Information Technology..... 132,500 - 37,500 45,000 25,000 25,000

Public Works........................ 3,322,000 550,000 897,000 600,000 625,000 650,000

Public Facilities................... 395,000 107,000 220,500 47,500 10,000 10,000

Sanitation............................ 1,446,000 - 686,000 480,000 280,000 -

Recreation........................... 896,060 117,500 373,360 405,200 - -

Total................................ 15,667,333$ 2,141,377$ 5,491,816$ 3,619,483$ 2,754,655$ 1,660,002$

17

accuracy and alert customers about their water usage.

A detailed list of the departmental capital outlays in the Utility Fund is provided in Appendix 4.

5 - Y E A R C I P C O N C L U S I O N

The 5-Year CIP provides a guide for decision makers and the citizens alike. By fully examining

alternatives and funding options during the planning process, the City Council can make

informed decisions and maximize City resources. The 5-Year CIP is a solid plan and has been

prepared with the goals of the City Council in mind.

As required by the N.C. general statutes, please accept this document as my recommendation

for the FY 2019 Budget and FY 2019-23 Capital Improvement Plan. As has been our tradition, I

am proposing that you set a public hearing at our regular meeting on June 4, 2018 to consider a

budget ordinance that will put this plan into action. Putting together a budget is not a small task,

and I would like to recognize Jeanne Tate, Karen Louis, Misty Stewart of the Finance

Department for all their contributions and crunching of numbers. Also, I would like to commend

the department heads as key contributors in making sure the numbers translate into a workable

plan, since they are responsible to carry it out. As always, staff looks forward to working with

you to keep Mebane a “positively charming” place to live, work and play!

Respectfully submitted,

David S. Cheek

City Manager


WWRF Upgrades............. 5,390,000$ 400,000$ 4,990,000$ -$ -$ -$

WWRF Floodwall............. 750,000 57,500 692,500 - - -

GKN Reroute................... 1,500,000 137,500 1,362,500 - - -

Annual Capital Outlays

WWRF............................ 278,118 49,922 63,196 90,000 75,000 -

Water Distribution........ 2,170,000 620,000 850,000 190,000 200,000 310,000

Meters............................ 1,000,000 500,000 500,000 - - -

Lift Stations................... 1,400,000 240,000 260,000 280,000 300,000 320,000

Sewer Mains.................. 2,760,000 540,000 840,000 450,000 460,000 470,000

Total........................... 15,248,118$ 2,544,922$ 9,558,196$ 1,010,000$ 1,035,000$ 1,100,000$

Funding Source

Pay As Go...................... 7,420,618$ 2,357,422$ 1,918,196$ 1,010,000$ 1,035,000$ 1,100,000$

Grants............................ 187,500 187,500 - - - -

Installment Financing.... 7,640,000 - 7,640,000 - - -

Total........................... 15,248,118$ 2,544,922$ 9,558,196$ 1,010,000$ 1,035,000$ 1,100,000$

18

A P P E N D I X 1 : B U D G E T M E S S A G E L I N E I T E M B U D G E T

C I T Y C O U N C I L

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 54,500$ 54,500$ 0.0%

FICA 4,172 4,170 0.0%

Group Insurance Contribution 1,500 1,500 0.0%

Subtotal Salaries 60,172 60,170 0.0%Schools & Conferences 7,000 7,000 0.0%

Departmental Supplies 1,350 1,350 0.0%

Technology Supplies Equip - NA

Dues & Subscriptions 17,500 17,640 0.8%

Subtotal Operating 25,850 25,990 0.5%

Total Council 86,022 86,160 0.2%

19

A D M I N I S T R A T I O N

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 691,828 718,706 3.9%

Longevity Contribution 22,524 23,425 4.0%

Part-time Salaries 15,000 15,000 0.0%

Car Allowance - - NA

FICA 55,795 57,433 2.9%

Group Insurance Contribution 52,465 47,439 -9.6%

Retirement Contribution 128,584 134,276 4.4%

401K Retirement Contribution 35,717 36,788 3.0%

Utility Contra (227,827) (250,089) 9.8%

Subtotal Salaries 774,086 782,978 1.1%

Professional Services 118,000 166,900 41.4%

Telephone & Postage 3,800 2,900 -23.7%

Schools & Conferences 11,000 8,000 -27.3%

Vehicle Maintenance & Repairs 100 100 0.0%

Advertising 2,000 2,000 0.0%

Vehicle Expense 100 100 0.0%

Departmental Supplies 23,500 20,000 -14.9%

Train Collection Expenses - NA

Technology Services & Supplies 5,500 5,500 0.0%

Wellness Program Expenses 7,100 7,000 -1.4%

Small Equipment 1,500 1,500 0.0%

Contracted Services 5,000 5,000 0.0%

Dues & Subscriptions 8,220 5,000 -39.2%


Capital Outlay - Other Improvements 18,000 27,000 50.0%

Capital Outlay - Vehicles 28,000 - -100.0%

Subtotal Capital 46,000 27,000 -41.3%

Total Administration 1,005,906 1,033,978 2.8%

20

F I N A N C E

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 300,724 306,847 2.0%


Part-Time Salaries 12,000 12,000 0.0%

FICA 24,504 24,992 2.0%




Utility Contra (126,676) (155,465) 22.7%

Subtotal Personnel 341,832 314,262 -8.1%



Schools & Conferences 8,650 9,350 8.1%

Equipment Maintenance & Repairs 500 500 0.0%

Advertising 1,800 1,800 0.0%

Tax Collection Fee 70,000 77,000 10.0%







Capital Outlay - Other Improvements 140,000 - -100.0%

Capital Outlay - Equipment - 5,000 NA


Total Finance 740,292 583,176 -21.2%

21

I N F O R M A T I O N T E C H N O L O G Y

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 76,726 79,470 3.6%


Cell Phone Stipend - 540 NA

FICA 6,046 6,304 4.3%




Utility Contra (35,487) (36,414) 2.6%

Subtotal Personnel 76,455 79,604 4.1%

Telephone and Postage 937 520 -44.5%

Schools and Conferences 3,450 3,550 2.9%

Equipment Maintenance & Repairs 5,000 5,000 0.0%


Technology Supplies and Services 1,100 3,250 195.5%

TWC Telecommunications 57,500 52,400 -8.9%

Software Licensing and Maint - 3,200 NA



Dues & Subscriptions 150 - -100.0%


Capital Outlay - Other - - NA

Capital Outlay - Equipment 31,774 - -100.0%

Subtotal Capital 31,774 - -100.0%

Total IT 243,431 240,889 -1.0%

22

E C O N O M I C D E V E L O P M E N T

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018


Industrial Development 1,045,850 625,850 -40.2%

Alamance County Chamber of Commerce 20,000 20,000 0.0%

Subtotal Operating 1,105,850 685,850 -38.0%


Subtotal Capital - - NA

Total Econ Dev't 1,105,850 685,850 -38.0%

23

P U B L I C F A C I L I T I E S

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 200,239 208,030 3.9%


Part-time Salaries & Wages 32,000 32,000 0.0%

FICA 18,081 18,722 3.5%




Utility Contra (13,520) (13,764) 1.8%



Utilities 27,600 28,500 3.3%

Building Maintenance 30,000 30,000 0.0%

Grounds Maintenance 45,500 54,000 18.7%

Lake & Marina Maint & Ops 65,000 65,000 0.0%

Library Maint & Repairs 64,000 88,000 37.5%


Technology 59,000 10,700 -81.9%

Facility Rental 4,800 4,800 0.0%

Contracted Services 62,000 47,000 -24.2%


Capital Outlay - Building - - NA

Capital Outlay - Other Improvements 31,000 - -100.0%

Capital Outlay - Equipment - - NA

Subtotal Capital 31,000 - -100.0%

Total Public Facilities 752,483 724,477 -3.7%

24

P O L I C E

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 1,843,361 2,007,702 8.9%



Overtime Salaries 10,000 10,000 0.0%

LEO Separation Allowance 40,000 40,000 0.0%

FICA 149,860 162,636 8.5%




LEO Retirement Contribution 323,338 354,427 9.6%

Subtotal Personnel 2,891,123 3,078,262 6.5%


Telephone & Postage 33,000 33,000 0.0%

Utilities 17,010 12,860 -24.4%


Building & Grounds Maintenance 15,000 15,000 0.0%

Vehicle Maintenance & Repairs 40,000 42,000 5.0%

Vehicle Expense 70,000 67,000 -4.3%



Uniforms & Accessories 39,500 40,030 1.3%

Federal Equitable Sharing Expense - - NA

Small Equipment 21,475 - -100.0%


Vice Investigations 5,000 5,000 0.0%


Pet Adoption Center Subsidy 73,235 75,475 3.1%

Subtotal Operating 605,703 603,613 -0.3%

Capital Outlay - Other 77,080 28,000 -63.7%

Capital Outlay - Vehicles 240,000 207,648 -13.5%

Capital Outlay - Machinery & Equipment - 10,621 NA


Total Police 3,813,906 3,928,144 3.0%

25

F I R E

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 1,367,604 1,380,133 0.9%


Part-time Salaries & Wages 30,000 40,000 33.3%


FICA 117,568 121,019 2.9%


Fraternal Insurance Contribution 6,000 6,000 0.0%



Fire Retirement Contribution 5,000 5,000 0.0%

Pension Expense 35,000 35,000 0.0%

Subtotal Personnel 2,190,672 2,220,997 1.4%



Utilities 25,000 25,000 0.0%


Volunteer Reimbursements 25,000 20,000 -20.0%

Building & Grounds Maintenance 33,000 25,000 -24.2%



Vehicle Expense 22,000 24,000 9.1%


EMT Equipment 10,000 10,000 0.0%



Small Equipment - 35,237 NA



Christmas Party 4,500 4,000 -11.1%


Capital Outlay - Vehicles - - NA

Capital Outlay - Machinery & Equipment 565,015 90,895 -83.9%


Total Fire 3,225,525 2,779,249 -13.8%

26

P L A N N I N G

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 150,829 163,848 8.6%


Part-time Salaries - 10,000 NA

Ovetime wages - 5,000 NA

Cell Phone Stipend 11,825 540 -95.4%

FICA 17,780 14,740 -17.1%



401K Retirement Contribution - 9,414 NA

Utility Contra - - NA





Building & Grounds Maintenance 970 1,000 3.1%

Vehicle Maintenance & Repairs - 250 NA

Advertising 3,000 4,500 50.0%

Vehicle Expense - 2,000 NA



Uniforms & Accessories 1,750 1,500 -14.3%

Impact Alamance Grant - - NA

Partners for Green Growth - 10,000 NA

Downtown Revitalization - 61,500 NA


Dues & Subscriptions 870 5,370 517.2%


Capital Outlay - Vehicles - NA


Total Planning 374,254 588,888 57.3%

27

I N S P E C T I O N S

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 278,285 293,318 5.4%


Part-time Salaries 14,000 10,000 -28.6%

Ovetime wages 10,000 5,000 -50.0%

Cell Phone Stipend - 540 NA

FICA 23,421 23,130 -1.2%


Retirement Contribution 52,588 52,334 -0.5%

401K Retirement Contribution 14,606 14,337 -1.8%

Utility Contra (14,645) (13,084) -10.7%




Building & Grounds Maintenance - - NA

Vehicle Maintenance & Repairs 4,500 2,000 -55.6%

Advertising - - NA



Technology Services & Supplies 14,400 13,400 -6.9%



Dues & Subscriptions 710 710 0.0%


Capital Outlay - Other Expenditures - 42,825 NA


Subtotal Capital 25,000 42,825 71.3%

Total Inspections 506,512 518,476 2.4%

28

P U B L I C W O R K S

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 610,862 512,809 -16.1%

Longevity Contribution 15,090 13,172 -12.7%


Overtime Wages 20,000 20,000 0.0%

Fica 52,475 47,888 -8.7%


Retirement Contribution 100,069 83,647 -16.4%


Utility Contra (182,137) (122,169) -32.9%



Professional Services II 50,000 60,000 20.0%


Utilities 203,000 221,000 8.9%


Building & Grounds Maintenance 42,935 33,000 -23.1%

Sidewalk Maintenance & Repair 190,000 70,000 -63.2%

Storm Sewer & Driveway Pipe Maintenance 40,000 40,000 0.0%

Street Maintenance & Repair 525,000 105,000 -80.0%

Equipment Maintenance & Rep 17,000 17,000 0.0%

Vehicle Maintenance & Repair 23,000 44,000 91.3%



Technology Services & Supples 21,725 25,400 16.9%

Uniforms & Accessaries 12,300 11,500 -6.5%


Dues & Subscriptions 2,500 2,170 -13.2%

Subtotal Operating 1,327,960 853,275 -35.7%

Capital Outlay - Other Improvements 25,000 14,700 -41.2%


Capital Outlay - Equipment - 12,500 NA


Total Public Works 2,151,996 1,596,312 -25.8%

29

S A N I T A T I O N

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 315,630 324,332 2.8%


FICA 24,431 25,204 3.2%





Telephone and Postage 2,500 3,000 20.0%





Roll-out Garbage Cans 27,000 22,000 -18.5%

Uniforms 7,200 9,000 25.0%

Landfill Tipping Fees 290,000 326,000 12.4%





Total Sanitation 988,415 1,127,918 14.1%

30

R E C R E A T I O N & P A R K S

General Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 417,459 474,800 13.7%


Part Time Salaries & Wages 90,000 118,000 31.1%

FICA 40,768 46,850 14.9%





Professional Services 50,000 25,000 -50.0%


Utilities 79,000 104,000 31.6%

Ballfield Lights 41,500 60,300 45.3%







Athletic Uniforms & Equipment 20,000 20,000 0.0%



Small Equipment - - NA



Special Activities 63,000 63,000 0.0%

Summer Camps 10,000 10,000 0.0%


Capital Outlay - Land - - NA


Capital Outlay - MACC Renovation - 63,500 NA

Capital - Fifth Street Pocket Park - - NA

Capital - First St Pocket Park - - NA


Capital Outlay - Machinery & Equipment 49,100 38,600 -21.4%


Total Recreation 1,373,484 1,629,325 18.6%

31

N O N - D E P A R T M E N T A L


Salaries for potential retirement - 52,192 NA

Unemployment Insurance Contribution 20,000 20,000 0.0%


Website Hosting 4,600 4,600 0.0%

Train Collection Expenses - 5,900 NA

Miscellaneous Contracted Services 38 - -100.0%

Property & General Liability Insurance 409,500 415,700 1.5%

Alamance County Arts Council Subsidy 10,000 10,000 0.0%

ACTA Subsidy 5,252 5,252 0.0%

Mebane Historical Museum Subsidy 37,600 37,600 0.0%

United Way - 1,000 NA


Principal - 2008 Issue (Rec & City Hall) 213,334 213,334 0.0%

Principal - 2003 Issue (Police Station) 60,000 - -100.0%

Principal - 2004 Issue (Library) 153,334 153,334 0.0%

Principal - Truck/Equipment 96,702 97,984 1.3%

Principal - Fire Station BB&T 173,334 173,334 0.0%

Principal - Fire Station PEMC 140,889 140,889 0.0%

Principal - New Park 388,667 388,667 0.0%

Principal - Fire Truck 49,000 46,833 -4.4%

Principal - Fire Radios - 86,375 NA

Principal - Police Vehicles - 41,530 NA

Principal - Police Radios - 93,886 NA

Interest - 2008 Issue (Rec & City Hall) 43,179 35,670 -17.4%

Interest - 2003 Issue (Police Station) 1,721 - -100.0%

Interest - 2004 Issue (Library) 12,797 7,115 -44.4%

Interest - Truck/Equipment 2,252 971 -56.9%

Interest - Fire Station BB&T 57,841 52,919 -8.5%

Interest - New Park 187,751 175,023 -6.8%

Interest - Fire Radios - 6,792 NA

Interest - Police Vehicles - 7,891 NA

Interest - Police Radios - 17,838 NA

Subtotal Debt Service 1,580,801 1,740,385 10.1%

Transfer to Special Revenue Fund - - NA

Transfer to Capital Fund - 1,561,530 NA

Transfer to City Park Project - - NA

Subtotal Transfers Out - 1,561,530 NA

Total Nondepartmental 2,182,924 4,006,159 83.5%

32

B I L L I N G & M E T E R I N G ( A D M I N I S T R A T I O N )

Utility Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 170,839 170,415 -0.2%


FICA 13,200 13,168 -0.2%




Pension Expense - - NA

Indirect Contra 600,291 577,901 -3.7%




Bank Charges 50,000 35,000 -30.0%


Departmental Supplies & Meters 95,115 239,190 151.5%

Technology Services & Supplies 52,000 8,238 -84.2%


Misc Over/Short - - NA




Total Billing & Metering 1,073,615 1,149,556 7.1%

33

U T I L I T Y O P E R A T I O N S

Utility Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 342,596 416,310 21.5%


Part-time Salaries & Wages - - NA


FICA 28,987 35,109 21.1%








Utilities 80,000 92,500 15.6%



Street Maintenance & Repair 30,000 NA



Advertising 1,000 1,000 0.0%



Fire Hydrant Maintenance & Repair 45,000 50,000 11.1%

Chemicals 85,000 88,000 3.5%

Formerly Chemicals, now Technology 2,500 5,000 100.0%



Purchase of Water 740,000 760,000 2.7%


Subtotal Operating 1,604,600 1,739,839 8.4%


Capital Outlay - Farrar Lane Pump Sta - - NA

Capital Outlay - Force Main Upgrade - - NA

Capital Outlay - 119 Bypass Relocations - 250,000 NA

Capital Outlay - Equipment 42,000 126,000 200.0%

Subtotal Capital 922,000 1,366,000 48.2%

Total Utility Operations 3,101,970 3,773,902 21.7%

34

W A T E R R E S O U R C E R E C O V E R Y ( W W T P )

Utility Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Salaries & Wages 480,281 535,754 11.6%


Part-Time Salaries 10,000 10,000 0.0%


Car Allowance 3,600 3,600 0.0%

FICA 40,002 44,334 10.8%








Utilities 146,000 155,000 6.2%


Buildings & Grounds Maintenance 7,900 8,200 3.8%


Vehicle Maintenance & repair 2,000 1,650 -17.5%

Advertising 200 150 -25.0%



Chemicals 85,000 89,400 5.2%

Formerly Chem, Now Technology 6,400 8,250 28.9%

Software License-Utility Cloud 4,000 2,500 -37.5%

Uniforms & Accessaries 3,400 4,150 22.1%



Laboratory Services 24,200 22,200 -8.3%

SCADA Services 12,800 15,340 19.8%




Capital Outlay - Equipment 41,922 97,922 133.6%


Total WWTP 1,505,701 1,685,318 11.9%

35

N O N - D E P A R T M E N T A L

Utility Fund

FY 2018

Original

FY 2019

Recommended

Change

from FY

2018

Property & Liabilty Insurance 100,000 62,000 -38.0%


Principal - 2001 Issue (Water Plant) - - NA

Principal - 1998 Refunding Issue 95,000 - -100.0%

Prinicpal - 1993 Issue (WWTP) - - NA

Principal - 2007 Issue (SE Pump Station) 133,334 133,334 0.0%

Principal - 2009 Issue (9th St. Sewer) 4,806 4,806 0.0%

Principal - Water Upgrade/Exension 272,000 279,000 2.6%

Water Plant Capacity Payment 127,403 127,403 0.0%

Sewer Capacity Payment 200,000 200,000 0.0%

Principal - GKN Pump Sta, Floodwall, WRRF 61,735 101,250 64.0%

Interest - 2001 Issue (Water Plant) - - NA

Interest - 1998 Refunding Issue 4,560 - -100.0%

Interest - 1993 Issue (WWTP) - 19,250 NA

Interest - 2007 Issue (SE Pump Station) 24,383 - -100.0%

Interest - Water Upgrade/Expansion 104,234 97,071 -6.9%

Interest - GKN Pump Sta, Floodwall, WRRF 30,000 40,500 35.0%

Subtotal Debt 1,057,455 1,002,614 -5.2%

Transfer to Capital Project Fund 1,166,294 500,000 -57.1%

Transfer to City Park Project - - NA

Subtotal Transfers 1,166,294 500,000 -57.1%

Total Non-Departmental 2,323,749 1,564,614 -32.7%

36

A P P E N D I X 2 : B U D G E T M E S S A G E F E E S C H E D U L E C H A N G E S

G E N E R A L F U N D F E E C H A N G E S

41

U T I L I T Y F U N D F E E C H A N G E S

Development Fees DRAFT Effective July 1, 2018

5.82 6.11 $150

6.25 6.56 $10

12.80 12.22 $50

12.50 13.12 $10

3.25 $25

$54.57 $6.50

$66.77 Additional Trash Receptacle $65.00

$75 $100

$75 $14

$150 $20

Deposit sewer (inside city limits)Water Line Assessment Rate (per

linear foot)

Deposit water (outside city limits)Sewer Line Assessment Rate (per

linear foot)

Outside sewer (per 1,000 gallon)Late Fee (added each month after

the 20th)

Deposit water (inside city limits)Water Shortage Resposne Plan -

Excess Users Charge (per event for

Inside water (per 1,000 gallon) Deposit sewer (outside city limits)

Inside sewer (per 1,000 gallon)Meter re-read with no city error

(per re-read)

Outside water (per 1,000 gallon)

Metered sewer users not using

Mebane water (Multipe of the inside Return Check Fee

Unmetered residential sewer users-

(inside city limits)

Users Fee - Trash & Recycle pick-up

(per month)Unmetered residential sewer users-

(outside city limits)

Water & Sewer Rates

Cutoff List Fee

Fee Schedule

Schedule Subject to Change Upon Approval by City Council

42


Water

Connection

System

Development

Fee

Sewer

Connection

System

Development

Fee

Water

Connection

System

Development

Fee

Sewer

Connection

System

Development

Fee

$1,100 $1,420 $8,250 $10,920

$1,540 $1,970 $17,050 $21,850

$26,400 $33,860

$1,100 $1,420 $41,800 $49,150

$1,320 $1,750 $82,500 $105,950

$2,200 $2,840 $128,700 $166,030

$4,400 $5,680

Water & Sewer System

Development Fees

All Other Zoning

Catergories - 3/4"

All Other Zoning

Catergories - 8"All Other Zoning

Catergories - 1"

All Other Zoning

Catergories - 10"All Other Zoning

Catergories - 1.5"

Multi-Family

Dwelling Unit (Per

Unit) - NA

All Other Zoning

Catergories - 6"

Hotels, Retirement

Homes, Assisted

Living Facilities

(per room)

75% of Single

Family for 3/4"

75% of Single

Family for 3/4"

Single Family

Dwelling Unit - 3/4"

All Other Zoning

Catergories - 2"Single Family

Dwelling Unit - 1"

All Other Zoning

Catergories - 3"Single Family

Dwelling Unit - >1"

Use Fee Under Other Zoning

Catergories

All Other Zoning

Catergories - 4"

Customer Type -

Water Meter Size

Customer Type -

Water Meter Size

Water & Sewer Connection

System Development Fees

Fee Schedule


43


See water and sewer connection system development fee schedule

$3,158

$4,001

$6,787

$500

$700

$1,500

3/4" Meter

1" Meter

3" Meter

Hydrant Meter Deposit

6" With Strainer

Pressure Sewer Connection Fees

3" With Strainer

4" With Strainer

Any item not included in the above schedule shall be referred to the Public Works Director for a specific price

determination. The above fees are payable at the time of application for a water and/or sewer tap or at the

time of application for a building permit.

Pressure Sewer User

Fee Schedule


44

A P P E N D I X 3 : 5 - Y E A R C I P G E N E R A L F U N D R E Q U E S T S B Y D E P A R T M E N T


Police

Vehicles..................................................... 878,891$ 207,648$ 155,737$ 163,523$ 171,699$ 180,284$

Space Needs Study................................... 30,000 30,000 - - - -

Radios and equipment.............................. 469,429 469,429 - - - -

Fire

Vehicles..................................................... 131,500 90,000 41,500 - - -

Tanker Truck............................................. 1,270,000 - - 750,000 520,000 -

Training tower classroom......................... 150,000 - 150,000 - - -

Preemption Sys - Mebane Oaks............... 72,000 72,000 - - - -

Body Armor............................................... 36,000 36,000

HVAC......................................................... 43,000 - 43,000 - - -

Renovations to staff qtrs........................... 50,000 - 50,000 - - -

Washer/Dryer............................................ 20,000 - 20,000 - - -

Public Works

Pickup Truck.............................................. 52,000 - 52,000 - - -

Dump Trucks............................................. 175,000 - 175,000 - - -

HVAC......................................................... 20,000 - 20,000 - - -

Relocate Fence & Gate - 119..................... 75,000 - 75,000 - - -

Resurfacing................................................ 3,000,000 550,000 575,000 600,000 625,000 650,000

Renovate City Hall front desk................... 27,000 27,000 - - - -

Windows at City Hall................................ 45,000 - 45,000 - - -

Wall/Sign at cemetery entrances............. 60,000 - 60,000 - - -

Branding Signs & Banners........................ 75,000 - 75,000 - - -

Christmas decorations.............................. 30,000 30,000 - - - -

Library....................................................... 88,000 20,000 30,500 37,500 - -

Art.............................................................. 70,000 30,000 10,000 10,000 10,000 10,000

Pickup Truck.............................................. 26,000 - 26,000 - - -

Garbage Truck.......................................... 1,020,000 - 460,000 280,000 280,000 -

Leaf Truck.................................................. 400,000 - 200,000 200,000 - -

IT

Network switches etc............................... 60,000 - 15,000 45,000 - -

Servers & related security......................... 72,500 - 22,500 - 25,000 25,000

Recreation

Tennis court resurfacing............................ 21,360 - 21,360 - - -

Replace Holt St Shelter............................ 29,000 29,000 - - - -

MACC Gutter replacement....................... 37,500 37,500 - - - -

Mowers, Equipment.................................. 51,000 51,000 - - - -

Parking lot at Old Rec............................... 55,200 - - 55,200 - -

Lighting Upgrade/Replacement.............. 320,000 - 320,000 - - -

Vehicles..................................................... 32,000 - 32,000 - - -

Lake Michael dam repair.......................... 350,000 - - 350,000 - -

Total............................................................ 9,342,380$ 1,679,577$ 2,674,597$ 2,491,223$ 1,631,699$ 865,284$

Funding Source:

Cash........................................................... 6,080,303$ 1,002,500$ 1,839,597$ 1,261,223$ 1,111,699$ 865,284$

Grant......................................................... - - - - - -

Debt .......................................................... 3,262,077 677,077 835,000 1,230,000 520,000 -

Total............................................................ 9,342,380$ 1,679,577$ 2,674,597$ 2,491,223$ 1,631,699$ 865,284$

45

A P P E N D I X 4 : 5 - Y E A R C I P U T I L I T Y F U N D R E Q U E S T S B Y D E P A R T M E N T


Water Resource Recovery Facility

Clarifier coating..................................... 55,118$ 21,922$ 33,196$ -$ -$ -$

Vehicles.................................................. 58,000 28,000 - 30,000 - -

Valve actuators...................................... 90,000 - 30,000 60,000 - -

Rehabilitation of electric panels........... 75,000 - - - 75,000 -

Meter Replacement................................. 1,000,000 500,000 500,000 - - -

Water Distribution

Annual maintenance.............................. 950,000 170,000 180,000 190,000 200,000 210,000

Old Hillsborough Road Improvements. 525,000 50,000 475,000 - - -

Backhoe replacement........................... 145,000 - 145,000 - - -

Oversize Cambridge Park...................... 100,000 50,000 50,000 - - -

Oversize Northeast Village................... 100,000 100,000 - - -

New Water Tank.................................... 100,000 - - - - 100,000

NC 119 Relocation.................................. 250,000 250,000 - - - -

Sewer Lift Stations

Pump & control panels.......................... 1,400,000 240,000 260,000 280,000 300,000 320,000

Reroute GKN Pump Station.................. 1,500,000 137,500 1,362,500 - - -

Sewer Mains

Repair & maintenance........................... 1,250,000 230,000 240,000 250,000 260,000 270,000

Inflow & Infiltration............................... 1,000,000 200,000 200,000 200,000 200,000 200,000

Boom mower......................................... 110,000 110,000 - - - -

Oversize Cambridge Park...................... 400,000 - 400,000 - - -

Total........................................................... 9,108,118$ 2,087,422$ 3,875,696$ 1,010,000$ 1,035,000$ 1,100,000$

Funding Source

Debt......................................................... 1,500,000$ -$ 1,500,000$ -$ -$ -$

Grants....................................................... 187,500 187,500 - - - -

Cash.......................................................... 7,420,618 1,899,922 2,375,696 1,010,000 1,035,000 1,100,000

Total........................................................... 9,108,118$ 2,087,422$ 3,875,696$ 1,010,000$ 1,035,000$ 1,100,000$

Budget Message 2018-2019 5-Year Capital Improvement Plan...

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